background image
background image
Highlights
2
background image
Earnings
4Q08 x 4Q09
Net Revenues
356
425
4Q08
4Q09
Net Income
202
220
4Q08
4Q09
236
4Q08
EBITDA
EBITDA Margin
66%
Operating
Expenses
Adjusted
120
134
4Q08
4Q09
276
4Q09
65%
20%
9%
12%
17%
BRL millions
GAAP
(except for OPEX)
Pro Forma
3
background image
Earnings
3Q09 x 4Q09
383
425
3Q09
4Q09
337
315
3Q09
4Q09
262
3Q09
68%
109
134
3Q09
4Q09
276
4Q09
65%
11%
-7%
23 %
6%
BRL millions
Net Revenues
Net Income
Adjusted*
EBITDA
EBITDA Margin
Operating
Expenses
Adjusted
4
* Excludes stock option plan and impacts from deferred liabilities tax
background image
Revenues 4Q09
169
144
83
131
265
4Q08 (Pro Forma)
4Q09
78
396
474
4Q09
BRL millions
Other revenues
Bovespa Trd, / Sttmnt
BM&F Trd, / Sttmnt
28%
56%
16%
5
background image
Revenues 2009
894
623
266
537
849
2008 (Pro Forma)
2009
287
1,783
1,673
Other revenues
Bovespa Trd, / Sttmnt
BM&F Trd, / Sttmnt
BRL millions
32%
51%
17%
2009
6
background image
2009 Expenses
Total and Recurring
BRL thousands
1Q09
2Q09
3Q09
4Q09
2009
4Q08
2008
Recurring Expenses
101,642
103,303
108,063
133,669
446,677
119,925 512,603
Severance expenses
18,000
-
-
-
18,000
-
-
(=) Expenses with impact on cash
flow
119,642
103,303
108,063
133,669
464,677
119,925 512,603
Stock Options Plan
18,758
13,446
11,936
15,494
59,634
-
-
Depreciation
8,951
9,887
11,546
12,012
42,396
8,212
31,942
Provision for Doubtful Accounts
1,409
1,562
957
(803)
3,125
-
-
(=) Total Expenses
148,760
128,198
132,502
160,372
569,832
128,137 544,545
7
background image
Expenses 4Q09
4Q09 impacted by
one off expenses, in
particular
Personnel and
Third Party
Services
BRL 3.6 million
rise in expenses with stock options
BRL 3.4 million
in expenses with severance
BRL 1.5 million
adjustment in overtime, as per agreement with
Union
BRL thousands
4Q09
3Q09
4Q08
(Pro Forma)
Change
4Q09/3Q09
Change
4Q09/4Q08
Operating Expenses
160,372
132,502
128,137
21%
25%
Personnel
74,124
63,883
50,945
16%
46%
Data Processing
31,186
24,233
28,674
29%
9%
Deprec, and Amortization
12,012
11,546
8,212
4%
46%
Third Party Services
17,303
9,370
10,338
85%
67%
Communications
6,969
6,219
5,226
12%
33%
Marketing
5,947
5,841
5,353
2%
11%
Others
12,831
11,410
19,389
12%
-34%
Adjusted Operational Expenses*
133,669
109,019
119,925
23%
12%
Adjusted Personnel**
58,630
51,946
50,945
13%
15%
* 4Q09 Excludes: stock options plan expenses , depreciation and
PDA
and in the 3Q09: stock options plan expenses and
depreciation and in the 4Q08: depreciation
** Excludes stock options plan expenses
Personnel: no material increase in headcount
8
background image
Accelerated project execution
at year-end, in
line with the 2009 budget
BRL thousands
4Q09
3Q09
4Q08
(Pro Forma)
Change
4Q09/3Q09
Change
4Q09/4Q08
Operating Expenses
160,372
132,502
128,137
21%
25%
Personnel
74,124
63,883
50,945
16%
46%
Data Processing
31,186
24,233
28,674
29%
9%
Deprec, and Amortization
12,012
11,546
8,212
4%
46%
Third Party Services
17,303
9,370
10,338
85%
67%
Communications
6,969
6,219
5,226
12%
33%
Marketing
5,947
5,841
5,353
2%
11%
Others
12,831
11,410
19,389
12%
-34%
Adjusted Operating Expenses*
133,669
109,019
119,925
23%
12%
Adjusted Personnel**
58,630
51,946
50,945
13%
15%
Data Processing
Expenses 4Q09
4Q09 impacted by
one off expenses, in
particular
Personnel and
Third Party
Services
9
* 4Q09 Excludes: stock options plan expenses , depreciation and
PDA
and in the 3Q09: stock options plan expenses and
depreciation and in the 4Q08: depreciation
** Excludes stock options plan expenses
background image
Strategic Projects :
CME and NASDAQ OMX Partnerships: at
BRL 3.0 million
Operational Qualification Program (PQO): at
BRL 2.6 million
Study for the New Pricing Policy / BM&F Segment Back-Office Solution: at
BRL 1.1 million
BRL thousands
4Q09
3Q09
4Q08
(Pro Forma)
Change
4Q09/3Q09
Change
4Q09/4Q08
Operating Expenses
160,372
132,502
128,137
21%
25%
Personnel
74,124
63,883
50,945
16%
46%
Data processing
31,186
24,233
28,674
29%
9%
Deprec. and Amortization
12,012
11,546
8,212
4%
46%
Third Party Services
17,303
9,370
10,338
85%
67%
Communications
6,969
6,219
5,226
12%
33%
Marketing
5,947
5,841
5,353
2%
11%
Others
12,831
11,410
19,389
12%
-34%
Adjusted Operating Expenses*
133,669
109,019
119,925
23%
12%
Adjusted Personnel**
58,630
51,946
50,945
13%
15%
Third Party Services
Expenses 4Q09
4Q09 impacted by
one off expenses, in
particular
Personnel and
Third Party
Services
10
* 4Q09 Excludes: stock options plan expenses , depreciation and
PDA
and in the 3Q09: stock options plan expenses and
depreciation and in the 4Q08: depreciation
** Excludes stock options plan expenses
background image
Summary of Financial Statements
NET INCOME RECONCILIATION
BRL thousands
4Q09
4Q08
(Pro Forma)
Change
4Q09/4Q08
Adjusted Net Income
315,313
202,404
55.8%
Adjustments
Deferred Liabilities
79,645
Stock Options Plan
15,494
GAAP Net Income
220,174
202,404
8.8%
3Q09
9M09
4Q09
Deferred Liabilities - Goodwill Amort.
79,645
238,935
79,645
Deferred Assets. - Taxes Losses
(24,183)
(33,123)
32,874
Others
4,734
13,817
4,442
Deferred taxes
60,196
219,629
116,961
DEFERRED TAXES RECONCILIATION
BRL thousands
4Q09
4Q08
(Pro Forma)
Change
4Q09/4Q08
3Q09
Change
4Q09/3Q09
2009
2008
(Pro Forma)
Change
2009/2008
Gross Revenues
473,890
396,369
19.6%
426,505
11.1%
1,672,894
1,783,358
-6.2%
BM&F Trd. / Sttmnt
130,969
144,410
-9.3%
132,707
-1.3%
537,056
622,907
-13.8%
Bovespa Trd. / Sttmnt
265,445
169,342
56.8%
221,594
19.8%
849,166
894,446
-5.1%
Other Operational Revenues
77,476
82,617
-6.2%
72,204
7.3%
286,672
266,005
7.8%
Revenue deductions
(49,131)
(40,855)
20.3%
(43,510)
12.9%
-
(42,339)
-100.0%
Net revenues
424,759
355,514
19.5%
382,995
10.9%
1,502,544
1,602,011
-6.2%
Operating expenses
(160,372)
(128,137)
25.2%
(132,502)
21.0%
(569,832)
(544,545)
4.6%
Operating income
264,387
227,377
16.3%
250,493
5.5%
932,712
1,057,466
-11.8%
Financial income
74,104
83,100
-10.8%
57,042
29.9%
253,862
306,093
-17.1%
Income before taxes
338,491
310,477
9.0%
307,535
10.1%
1,186,574
1,363,559
-13.0%
Income tax and social
contribution
(1,410)
(96,339)
-98.5%
(544)
159.2%
32,085
(458,497)
-107.0%
Deferred income tax and
social contribution
(116,961)
(11,128)
951.1%
(60,196)
94.3%
(336,590)
6,109
-5609.7%
Minority interest
54
(606)
-108.9%
(1,029)
-105.2%
(1,019)
(1,567)
-35.0%
Net Income
220,174
202,404
8.8%
245,766
-10.4%
881,050
909,605
-3.1%
Net margin
51.8%
56.9%
-5.1 bp
64.2%
-12.3 bp
58.6%
56.8%
1.9 bp
EBITDA
276,399
235,589
17.3%
262,039
5.5%
975,108
1,089,408
-10.5%
EBITDA margin
65.1%
66.3%
-1.2 bp
68.4%
-3.3 bp
64.9%
68.0%
-3.1 bp
Adjusted net income
315,313
202,404
55.8%
337,348
-6.5%
1,223,763
909,605
34.5%
Adjusted net margin
74.2%
56.9%
17.3 bp
88.1%
-13.8 bp
81.4%
56.8%
24.7 bp
Adjusted operating expenses
(133,669)
(119,925)
11.5%
(109,019)
22.6%
(446,675)
(512,603 )
-12.9%
11
background image
Financial
Highlights
Cash and Cash Equivalents
Financial Income
2.22
2.39
0.98
0.81
3Q09
4Q09
Own Financial
Resources
Third Party
Collaterals
3.2
(BRL billions)
(BRL millions)
57
74
3Q09
4Q09
30%
3.2
12
background image
4Q09 RESULTS
Dividends and Interest on Capital
Proposal of
BRL 248 million
as dividend
BRL Millions
1Q09
2Q09
3Q09
4Q09
2009
GAAP Net Income
226,980 188,130 245,766 220,174 881,050
Dividends and
Interest on Capital
112,000 175,000 150,000 268,000 705,000
% Accumulated
49%
69%
69%
80%
80%
Dividends and Interest on
Shareholders´s Equity
Declared
705,000
GAAP Net Income in 2009
881,050
13
background image
DURING THE DOWNTURN,
BM&FBOVESPA
30 times faster Round Trip Time
Invested in improvements in trading and
post-trading systems
Quadrupled daily throughput
2007 - 390 thousand
2009
­
1.5 million
2007
­
450ms
2009
­
10 ms
CONTINUED TO BELIEVE IN
THE CAPITAL MARKETS
14
background image
Excellence in
IT Solutions and
Post-Trading Services
Managed growth to support retail and high frequency trading
DMA Implementation (Direct Market Access)
RCB Development (new BM&FBOVESPA Communication Network)
Via DMA
Co-location
Traditional
DMA
Via DMA
Provider
Direct
Connection
NET
NET
NET
NET
Remote access
tracking and maintenance
Application of
Co-location
NET
Provider
of DMA
15
background image
Growth in customer and
revenue base
Intensified
financial education efforts
Sales force
growth
in Brazil and
cross border
Evolution in partnership with the
international
exchanges
CME, NASDAQ OMX and Latin America
16
background image
May/08
Dec/09
IT* and Post-Trading
1,147
832
Growth in Customer and
Revenue base
235
188
Corporate
446
286
Total
1,828
1,306
Enhanced institutional
strength
Completion of the integration process creating one of
the largest exchanges across the world
Personnel Realignment focus on
core business
Emphasis on cost savings
and enhanced
controls
Renewed organization culture
* Includes outsourced services
17
background image
New investments cycle led by:
Brazilian Market Potencial
Pre-Salt
Rio 2016
World Cup
High demand for
improved infrastructure
18
background image
Brazil is expected to rise to sixth
world power by 2013*
Per capita income should jump to
USD 10.9 thousands by 2011 from
USD 7.9 thousands
(BofA Merrill Lynch)
Consistent cuts in interest rate could
boost household savings, driving
investments in
more sophisticated
financial products, as equities and
securitized derivatives
PricewaterhouseCoopers Forecast
* In p,p,p.
­
purchasing power parity
19
background image
Growing Middle Class
The effect of stability and
economic growth
In large part,
middle and lower middle
income earners
do build savings, even
if not consistently
Do not save
Save a little every
month
Save as they can
15%
27%
58%
2009
42.4
52.9
% of population
Source: FGV / IBGE
2003
Few however, invest savings in equity
Number of investors
Middle Income- 30,000 (0.03% of middle-income earners)
Upper-middle income and upper income - 522,000
(2.6% of upper-middle income and upper-income earners)
Source: DataFolha
20
background image
Nasdaq
KEx
Shanghai
DB
Borsa
Italiana
NYSE
BME
Tokyo
LSE
AUX
TSX
NSEI
HKEx
SGX
BVMF
1,027%
243% 229%
171% 162% 161% 146%
129% 107% 98% 96% 88% 84%
67%
67%
Brazilian capital markets indicators are still incipient when
compared to world benchmarks
Brazil places 28th of WFE ranking,
with 386 listed companies in Dec/09
High potential
for growth
Source: WFE
TURNOVER VELOCITY
446%
Shenzhen
21
background image
Number of investors
accounts in
investment funds
264.5 million
(58% of population)
USA
BRAZIL
10.2 million
(5% of population)
USA (Oct/09)
World(Jun/09)
Brazil (Nov/09)
% in Equities
43%
40%
13%
Modest exposure of
Investment Funds
Source: ICI- Investment Companies Institute and Anbima
22
background image
Modest development in fixed-income and
agricultural commodity derivatives
Real Estate Credit to GDP Ratio
Agricultural commodity
derivatives to total
exchange industry*:
World
­
5.3%
Brazil
­
0.7%
* Jan-Sept/2009
44%
15%
11%
3%
62%
USA
Spain
Chile
Mexico
Brazil
Source: FIA
Source: CDES Social and Economic Development Board and World Bank
23
background image
2010
Strategic Drivers
OPEX
(BRL millions)
Budget OPEX
(BRL millions)
Budget CAPEX
(BRL millions)
2009
2010
Excellence in IT Solutions and
Post-Trading Services
219
309
277
Growth Customer and
Revenue Base
83
113
-
Institutional / Corporate Areas
145
128
25
TOTAL
447
550
302
24
background image
CAPEX (BRL Millions)
302
Investments in Technology
(Projects + Micro Information)
277
New data centers
55
Increase in capacity
47
BVMF-CME new multi-asset class electronic
trading platform
46
Improvements to IT infrastructure
45
Others Projects (New Clearing Facility, New
SINACOR system, Information Security, etc)
84
Investments in Other Areas
25
IT
Investments
25
background image
MoU
GLOBAL PREFERRED STRATEGIC
PARTNERSHIP WITH THE CME GROUP
Increase in ownership interest and a seat in the Board
Technology Partnership
International Expansion
Order routing system
Listed Exchanges Ranking on 02/12/10
(USD billions)
18.9
17.9
13.6
12.4
7.3
26
background image
Post-Trading Services
Integration and Opportunities
Unified portfolio risk
Introduction of a pool of collaterals
Greater efficiency in managing daily liquidity of the participants
PARTICIPANTS
Equities
Fixed
Income
Derivatives
Spot FX
27
background image
Business and Service Center (Single Gateway)
Central
Counterparty
Clearing
Facility
Central
Depository
Post-Trading Services
Integration and Opportunities
Unified portfolio risk
Introduction of a pool of collaterals
Greater efficiency in managing daily liquidity of the participants
PARTICIPANTS
28
background image
Growth in customer and
revenue base
Popularization and financial education
Attracting high-frequency traders
New pricing policy
Attracting non-resident retail investors
Order routing agreements with the CME and NASDAQ
29
background image
Product development
Currency futures and forward contracts
Cash-settled ethanol futures contracts
Options on single stocks: market maker
New indices-based / ETFs
Fixed income: agribusiness and real estate
Redouble prospecting for
small and mid-cap companies (Bovespa Mais)
BDRs, subsidiary IPOs and
dual listing
Growth in customer
and revenue base
30
background image
Establishing Offices for:
Research and Business Projects
Corporate Risk
Sustainability
Internal Controls and
Project Management
Engaging a
System Management
consulting
firm (INDG
­
Vicente Falconi)
Engaging a
Branding consulting
firm
(Thymus)
Restructuring the Market
Ombudsman
role
Enhanced institutional
strengthening
31
background image
Since the exchange integration process, BM&FBOVESPA has been
evolving in terms of operating efficiency...
Round Trip Time, in milliseconds
2007
2008
2009
2010e
Equity Market
450
300
10
1-2
Derivatives Market
70
25
10
1-2
·
Includes outsourced services
* Related to May/2008
Throughput in thousands of trades
Equity Market
­
Average Capacity
390
770
1,500
3,000
Daily Average
153
245
332
Markets peaks
343
414
591
-
Derivatives Market
­
Average Capacity
55
200
200
400
Daily Average
23
29
39
Markets peaks
42
49
76
-
Number of employees*
1,828*
1,487
1,306
1,471
Network Carrier
RCCF`s Sole Provider
8 Networks (RCB)
...Moving Forward, we will grow even further
32
background image
1.6
297
87
153
245
332
278
326 334
392
424
2005 2006 2007
2008 2009
4Q08 1Q09 2Q09 3Q09 4Q09
Jan/10
Average Daily Number of Trades Evolution (thousands)
Average Daily Traded Value Evolution (BRL billions)
2005 2006 2007
2008 2009
4Q08 1Q09 2Q09 3Q09 4Q09
Jan/10
4.4
2.4
4.9 5.5 5.3
3.9
5.2 5.2
6.8
6.8
62
Operational Highlights
BOVESPA
33
background image
Operational Highlights
BOVESPA
Investor s Participation in Total Volume
25.4%
27.5%
32.8%
11.7%
2.3%
0.3%
24.6%
27.2%
35.5%
10.4%
2.2%
0.1%
23.0%
29.8%
34.5%
10.7%
2.2%
0.2%
26.8%
27.1%
35.3%
7.8%
2.8%
0.1%
30.5%
25.7%
34.2%
7.4%
2.2%
0.1%
31.1%
24.0%
35.5%
5.8%
3+4%
0.2%
33.5%
23.6%
34.3%
6.5%
2.0%
0.1%
30.4%
24.7%
36.6%
5.8%
2.4%
0.0%
30.4%
26.3%
34.6%
6.5%
2.4%
0.1%
29.1%
27.3%
31.6%
9.8%
2.1%
0.1%
31.5%
29.4%
28.0%
8.8%
2.3%
0.1%
2005
2006
2007
2008
2009
1Q09
2Q09
3Q09
4Q09
Jan/10
4Q08
Retail Inv.
Institutional
Foreign Inv.
Fin. Institution
Companies
Others
34
34
background image
2005
2006 2007
2008
2009
4Q08 1Q09
2Q09 3Q09 4Q09
Jan/10
2005
2006 2007
2008
2009
4Q8
1Q09
2Q09 3Q09 4Q09
Jan/10
0.8
1.2
1.7
1.6
1.5
1.9
1.789
1.345 1.389 1.391 1.333
1.467
1.247 1.224
1.522
1.365
1.254
Average Daily Traded Volume Evolution and RPC
56%
51%
49%
48%
45%
44%
48%
46%
44%
44%
43%
24%
25%
23%
23%
24%
22%
21%
24%
26%
25%
27%
12%
15%
17%
19%
20%
21%
19%
19%
20%
22%
22%
7%
7%
9%
8%
8%
9%
9%
8%
8%
6%
5%
2%
2%
2%
3%
3%
3%
3%
3%
2%
2%
Retail Inv.
Daily Average
(millions of contracts)
RPC (BRL)
Institutional
Foreign Inv.
Companies
Central Bank
1.2
1.5
1.6
1.4
1.6
Operational Highlights
BM&F
Investor s Participation in Total Volume
35
35
background image